Back in 1995, Craig Newmark of Craigslist lore was just an unknown technologist who started a “hobby” of publishing an e-mail distribution list of social events where people in San Francisco could meet up. Fresh off a lengthy stint at IBM, he had just taken a job with Charles Schwab, he was new to the city, and he thought something simple that informed people of upcoming art and technology events would be helpful. From its earliest moments, his effort was noteworthy for its culture of trust, its sense of civic service, its passion for the San Francisco community, and its dis-embrace of all things commercial. Today, it is common in newspaper and journalism circles to finger Craig Newmark’s hobby-turned-global classified advertising portal, Craigslist, for the dramatically vulnerable position newspapers find themselves in by his having poached the industry’s primary revenue source.

But around the time Craigslist was unfolding I was working as a reporter with the Los Angeles Timesand there was a moment in the newsroom that left me wondering whether newspapers were beginning to lose their way for completely different reasons. It happened on a weekend when a reporter colleague was doing a routine check-in of the Los Angeles-area police stations to see if any newsworthy crimes had occurred. One station told her there had been a fatal gang incident involving several youths. I overheard her end of the conversation in which, toward the end of the phone call, she asked something to the effect of, “Was there anything unusual about it?” The next day, the newspaper ran only a small article about the disturbing incident in an inside section of the paper. I remember wondering whether this symbolized a disconnect between the newspaper and the community, a breach of the newspaper’s covenant as watchdog and guardian. The incident stayed with me long afterwards, even after I left the Los Angeles Times and the newspaper industry, and especially in those moments when I’ve reflected on how we arrived at the current crisis in newspapers and journalism.

Without a doubt the off-the-cliff drop in classified advertising due to Craigslist has been a major dilemma for the newspaper industry. But another cause of the crisis— arguably, a more fundamental one because it is both structural and existential—has been the struggle for newspapers and journalistic entities to stay true to their larger social mission in their communities and beyond.

The roots of this erosion, I believe, can be traced back to the nature of contemporary media ownership and industry consolidation that has resulted in the dramatic reshaping of newsgathering in the pursuit of higher monetary profits. I saw this phenomenon firsthand before I left the newspaper industry in the fall of 2000.

What’s interesting about the conversation that typically takes place about the sustainability of the newspaper industry is that while the loss of classified advertising due to Craigslist is real, the intangible issues highlighted by Craigslist are no less real. Trust, respect, engagement of the community, a sense of community service, not being greedy—these are the qualities that have helped Craigslist and Newmark, its unassuming founder, prosper. But such characteristics were once aspirational goals of newspapers if not actual ones. Craigslist last year was heavily criticized for its “adult services” section, which seemed to all but promote prostitution, and the company appears to have responded positively to concerns expressed by government, media, advocacy groups, and celebrities. But that issue aside, when I listen to Newmark, aka “the man who killed the newspaper,” talk about his appreciation for the importance of public service journalism and especially investigative journalism, I cannot help but feel he sounds far more like a journalist and newspaper advocate than most contemporary newspaper publishers and owners do.

Watchdogs and press lords

Editor John Carroll is on a short list of any American journalist’s list of most respected newspaper editors. A former top editor of The Baltimore Sun, The Lexington Herald-Leader in Kentucky, and the Los Angeles Times (our careers crossed there for just a few months in 2000) and ex-metropolitan editor at The Philadelphia Inquirer when it won numerous Pulitzer Prizes, he has invested considerable time investigating the future of newspapers and journalism thanks to support from the Knight Foundation and the Shorenstein Center. As part of his research, he interviewed dozens of luminaries, one of whom was super-investor Warren Buffett. His time with Buffett drove home the reality of the utterly remade landscape newspapers and journalism faced and also highlighted that the industry itself is responsible for significant portions of its plight.

“I spent a Saturday morning with Buffett in his office in Omaha,” Carroll recounted. “He told me hilarious stories about how he realized that newspapers were a racket. He told me about a conversation he had with a British press lord who owned a paper in the city across the river from Omaha. Buffett told me he asked this press lord one time, ‘How do you decide how much to raise your advertising rates?’ He said the press lord laughed and told him, ‘Oh, I tell my American managers, every year we raise them of course, but I think that a 45 percent profit margin is probably enough.’ He said, ‘After you get by that, you’re almost gouging.’

“Buffett thought that was the funniest thing he’d ever heard—45 percent. So, Buffett got into the business. And he invested in Washington Post stock in the early 1970s. By the time the Post stock peaked in 2004 … [it] was worth 175 times what he had paid for it. That just tells you what a lucrative business it was … We had a quasi-monopoly.”

No more. “With the Web, the 11-year-old kid down the street can sell ads online just as much as the guy who has $200 million worth of printing presses. Advertising has become plentiful and cheap. And that has really crushed newspapers’ ability to do what they have done in the past.”

Nobody can be expected to be sympathetic toward an industry being torqued by the same Darwinian forces it has employed to its advantage for decades. But newspapers aren’t just another industry. They still occupy a unique role in journalism. And journalism occupies an indisputably essential role in democratic society.

“I don’t think that the survival of newspapers—as a daily paper entity that is delivered to homes or available on newsstands—is important,” said Professor Howard Gardner of Harvard University, a pioneering scholar in ethics, human intelligence, and social science. He has written extensively on how market forces have affected the fields of journalism and genetics. “But if you ask whether journalism as a profession is necessary, the answer is a resounding yes.

“Journalism came into its own in democratic societies over the last century and has made an enormous difference in the health of those societies. It is hard to think of American history in the latter half of the 20th century without thinking of the Pentagon Papers, Watergate, and more recently, the investigative journalism that did or did not take place concerning the alleged weapons of mass destruction in Iraq,” Gardner said.

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